Individuals are regarded as being tax resident in Malta for a particular year if, in that year, their stay in Malta exceeds 183 days. Foreigners residing in Malta will in most cases also be considered as being ordinarily resident in Malta but will generally not be regarded as being domiciled in Malta. Please refer to the section on Taxation of Individuals for more information.
EU / EEA Individuals
EU / EEA nationals and their family members are entitled to obtain residence in Malta on a number of grounds including:
- accepting offers of work and seek employment in Malta;
- work (whether as an employee or in self-employment);
- set up a business.
Nevertheless, an EU national does not require an employment licence to work in Malta. Economically self-sufficient persons and students are merely two groups of persons that may obtain residence in Malta on separate grounds from employment and self-employment.
Economically self-sufficient persons
Pensioners and retired persons fall under this category. An EU/EEA national does not necessarily have to work while s/he is living in Malta. However in order to reside in Malta, s/he must be able to support himself/herself and his/her family members accompanying or wishing to join him/her in Malta, without recourse to public funds. The EU/EEA national concerned must be covered by sickness insurance against all risks whilst in Malta and have sufficient resources not to become a burden on the State. In this respect the above-mentioned level of resources should be the minimum means which determine the grant of social assistance to Maltese nationals. Currently this should be a capital of at least €14,000 or a weekly income of €92.32 or, in the case of a married couple, a capital of €23,300 or a weekly income of €108.63. Moreover for each other dependent an extra €8.15 should be added. Moreover, the personal circumstances of the EEA National and accompanying family members, shall be taken into consideration as regards their right of residence.
An EEA national and his family members (as defined below) have also the right of residence in Malta if the EEA national concerned is following a course of education, including vocational training and is enrolled in a recognized educational establishment in accordance with the Education Act or with the Employment and Training Services Act. S/he enjoys such right of residence provided that s/he has enough resources to be able to support himself/herself and family members without recourse to public funds and must have also sickness insurance against all risks in Malta.
Family members of an EEA national have the right to join and accompany him/her in Malta. The family is defined as:
- The spouse;
- Children or grandchildren of EEA nationals or those of his/her spouse, who are under 21 years of age or who are dependent on him/her;
- The dependent parents or grandparents of the EEA national or of his/her spouse.
Registration certificates and Residence Cards
A registration certificate is a document issued to an EEA national that confirms that person’s right of residence under European law. Residence cards are issued to family members of an EEA national who are third country nationals. The card confirms such persons’ right of residence in Malta. It is mandatory for EEA nationals and their family members to be in possession of the said documents if their residence in Malta is for a period exceeding three months.
Once the EEA national (and his/her family members) has lived in Malta for a continuous period of five years s/he is entitled to apply for confirmation of permanent residence. It is required that s/he has been living legally in Malta and has been in employment, or self-employment, or as a student or as an economically self-sufficient person throughout the five year period. For residence in Malta to be considered continuous, one must not have been absent from Malta for more than six months each year. Additionally, a single absence of a maximum of 12 months for important reasons such as pregnancy, child birth, serious illness, study, vocational training or posting overseas, will also not affect the required continuous residence.
Residence permits to third country nationals (TCNs) are issued in the form of a standalone plastic card with electronic features. Residence permits are issued to TCNs who have been authorized to reside in Malta for a specific purpose. This purpose could be:
- Economic self-sufficiency
- Studying in Malta
- Family Reunification
- Long-term residence
- Partners of a Maltese Citizen / EU Citizen
- Exemption under national legislation
- Highly qualified employment
- Other reasons
The applicant has to present the necessary documents in support of his/her claim – copy of a work permit for employment, copy of work permit/trading licence for self-employment and hospital or medical certification in the case of health reasons, amongst other documents.
Formalities in Relation to Employment
In respect of third country nationals, an employment licence is required and is only granted in exceptional cases. In order to qualify for self-employed status, a third country national must meet one or more of the following criteria:
- Invest in Malta capital expenditure of at least €100,000 within 6 months from the date on which the ETC licence is issued. Capital expenditure shall solely consist of fixed assets (such as immovable property, plant and machinery) used for the business purposes as reflected in the business plan submitted with the application. Rental contracts do not qualify. Such expenditure needs to be supported by receipts in the TCN’s name. The application also needs to be accompanied by a letter of reference in respect of the TCN, from a reputable Maltese bank that certifies that the TCN has the facility to raise such capital. A Business Plan is required, indicating clearly when such investment is to occur, within twelve months from application;
- Highly skilled innovators with a sound business plan who commit to recruiting at least three EEA/Swiss/Maltese nationals within eighteen months of establishment. A business plan ought to be submitted with the application for employment
- Sole representative of an overseas company (with a sound reputation and established for at least three years abroad) wishing to open a branch in Malta. Evidence of such representation is required on application;
- A person leading a project which has been formally approved by Malta Enterprise and formally notified by the latter to ETC. Formal notification by Malta Enterprise is required on application.
Applications for an employment license containing a firm commitment pertaining to the engagement of EEA/Swiss/Maltese nationals as part of the staff complement will assist in the favourable consideration of an application.
Formalities in Relation to the TCNs of Malta Companies seeking Malta Residence
In respect of TCNs, an employment licence is required. Such company for which the TCN is a shareholder or ultimate beneficial owner must meet one or more of the following criteria:
- Every TCN shareholder must have a fully paid up share capital of at least €100,000 which may not be redeemed, reduced or transferred to a third party during the first two years following the issuing of the Employment Licence;
- Have made a capital expenditure of at least €100,000 that is to be used by the company. Capital expenditure shall solely consist of fixed assets (such as immovable property, plant and machinery) used for the business purposes as reflected in the business plan submitted with the application. Rental contracts do not qualify. Such expenditure needs to be supported by receipts in the company’s name;
- The company is a sole representative of an overseas company (with a sound reputation and established for at least three years abroad) wishing to open a branch in Malta. Evidence of representation is required;
- The company is leading a project that has been formally approved by Malta Enterprise and formally notified by the latter to ETC.
At application stage a business plan in conformity with the Memorandum and Articles of Association of the company, must be submitted together with a letter of reference from a reputable Maltese bank that the TCN has the ability to raise the capital to which he/she would have committed himself/herself;, in respect of the TCN in favour of whom the licence is to be issued.
Applications containing a firm commitment relating to the engagement of EEA/Swiss/Maltese nationals as part of the staff complement of the company will assist in the favourable consideration of an application.
With regard to executive directors and in those cases where a director is not a shareholder, the application does not need to meet the above criteria. However, it will be processed from a labour market consideration. There are many aspects to labour market consideration, including the national situation in respect of surpluses or shortages in the given occupation and sector; the employer’s history and situation in terms of recruitment and redundancy patterns; business investments; and contractual commitments. The TCN’s skill level, relevant experience and overall suitability for the position in question are also taken into account. Applications for TCNs from firms that have effected redundancies in the post in question, or in similar positions to that being applied to, in the preceding twelve months will not be entertained. Moreover there are a number of specific occupational/sectoral considerations which apply.
TCNs in Possession of a CIR Certificate
Third country nationals in respect of whom the Director General of Inland Revenue (DGIR) has issued a permit under the conditions of the Permanent Residence Scheme, High Net worth Individuals non-EU/EEA/Swiss National Rules, or the Global Retirement Programme, have to apply for a uniform residence permit. They have to produce evidence of health insurance for themselves and members of their families. They need not, however, submit documentary evidence about income and accommodation.